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With a new administration in D.C., it's time to think outside of the box because passenger rail's survival just may depend on it

Sunday, October 20, 2013

Section 209

On Tuesday, Indiana became the 19th and final state agency to reach an agreement with Amtrak to pay more to keep the Hoosier State running. 

The provision in the 2008 law known as PRIIA Section 209 was the source of consternation for many state agencies and rail advocacy groups alike but it allows all states operating routes shorter than 750 miles to pay their fair share. Up until this month, Michigan and New York didn't have to pay a penny for Wolverines or Empire Service because Amtrak deemed both corridors as part of its system.

Time to Rant

Throughout the year, I have been keeping tabs on how the states would handle the October 1 deadline, and it appears to me that the states took it much better than the people who are supposed to represent train travel or the media.

This is what I read:
·         Washington State seriously considered cutting Cascades #513 & #516 back to Bellingham nearly two years after those two trains kept the Vancouver, BC portion that was tantamount to pulling teeth with the BC government in 2010 and ‘11
·         Conflicting reports during the last two weeks in August over whether the PA DOT had actually reached a deal with Amtrak to keep the Pennsylvanian running
·         Newspaper article after newspaper article detailing how all of these routes would go away on October 1 if the state in question didn't reach an agreement with Amtrak
·         Most members of the rail community acting like it was Amtrak or bust when actual options are available for most of the state agencies—i.e. any corridor that’s outside of the Wolverine and Empire Corridors

Outside of Indiana’s Hoosier State, all of this worrying was unnecessary and shows how wedded to Amtrak most members of the rail community really are when they should be advocating improved passenger service with as many entities the U.S. can bear.

The October Trains Magazine article went into detail about Section 209, but Bob Johnston also neglected to mention the possibility of competitors scooping in and replacing Amtrak as the operator of choice in these states. As a matter of fact, the AIPRO has spent the better part of the last 2 ½ years trying to get anyone who cares about train travel to listen and any politician in D.C. to pay attention to Section 214, which allows competition. As a matter of fact, one of its members expressed an interest in running California and Midwest routes. 

Johnston then went on to mention that as of July, none of the states had signed a contract with Amtrak for the new fiscal year (that number went up to seven a month ago  and up to 16 two weeks ago). Based on that Trains article, an Amtrak critic was right when he predicted the huge price increases for states that continue to contract their services out to Amtrak—which turned out to be all of them. 

California paid an extra $19 million for all three of its routes while Virginia’s Lynchburg extension of the Northeast Corridor went from making a surplus to “providing a significant subsidy” to Amtrak (as Johnston pointed out). I’m pretty sure that Veolia would have been able to save the Golden State tens of millions (nine figure savings=profit) if someone in Sacramento had taken the initiative to speak to the independent operator. As for VA, I’m at a loss for words since its (now former) money making route is attached to Amtrak’s spine (aka the Northeast Corridor).

In the end, the states played it safe rather than being bold—no one wanted to be the first state to dump Amtrak in favor of another operator. Perhaps, this is based on what happened to one of them a decade ago. 

Based on the states agreeing to stick with the status quo, additional frequencies and extended service will likely be subject to controversial Amtrak feasibility studies which will be time consuming and result in the states forking out even more money to the national carrier. The chief problem will be with the state DOTs who may get tired of spending lots of money to Amtrak and begin looking elsewhere if the economy doesn't pick up.

Ironically, states with sparse passenger train service or none at all may end up as the big winners because they have a template of what to expect from Amtrak so they could then choose to lease their routes out to independent operators as the demand grows. Ten years from now, All Aboard Florida could be such a success that the FL DOT provides corridor service with an AIPRO member or another non-Amtrak entity while historic leaders like Washington and Oregon could stagnate or become laggards due to them paying extra to Amtrak and those costs busting their states' budgets.

All of this inside the box thinking by True Believers and state DOTs cannot hide the fact that the old one size fits all, solo entity model is crumbling and it’s best that they come to terms with multiple entities—just like how trains are operated in places like the UK, Germany, Sweden and Japan. The pendulum has swung back in this direction because people are once again demanding top notch train travel. I will say that I am one of the very few people in the reform Amtrak camp who opposes the company being abolished, so if anyone thinks that I am harsh to the company, check out almost anyone else who wants an end to the passenger rail monopoly and you will quickly realize that I am being quite generous with my statements calling the company out on its complacency.

What Now?

Now that the federal government has yet again averted a major crisis, Congress needs to work on a rail reauthorization bill that not only encourages competition but mandates it. I would suggest that separate bidding procedures are set up for corridors and long distance service so there is no confusion on which routes are up for bid whatsoever.


In any case, these new operating agreements could turn out to be nothing more than one to three year extensions which could allow states to talk to other operators and subsequently ink deals with them. Older members of Amtrak’s management team are genuinely afraid of other operators running existing routes because there’s the potential for a domino effect that could lead to Amtrak only operating Midwest and Northeast routes outside of the National System (i.e. the long distance routes). Once these operating agreements expire over the next three years, the next Amtrak president will need to figure out which (non-NEC) routes it should focus on and which routes would be better off with someone else.

Wednesday, October 16, 2013

Tackling the Headlines 56

Mexico to tender $7.4 billion in passenger train projects in 2014
Take: They're getting serious. Hopefully, the political situation will improve enough to provide connecting train service to the U.S.

The Adirondack Scenic Railroad saga takes an ugly turn
Take: When it comes to the fight to just preserve the tracks on the right of way, it is way beyond preposterous that a loud group of people who are having a hard time masking their hatred of trains. The sabotaging of the railroad's property and locomotive show how low some northern New Yorkers are willing to go just to turn perfect rail pathway into a trail very few people will use.

Bad news for anyone who hates passenger rail competition
Take: While the Labour Party could very well return to the topic of re-nationalizing passenger rail in the future, they aren't going to touch it when Brits have other more important topics on their minds. Mr. Lodge points out how the arguments True Believers use are very misleading. America would be wise to learn from Britain's mistakes once Congress finally gets around to addressing passenger competition as part of a new rail bill.

Passenger excursions along a part of the old Seaboard route
Take: If these excursions prove to be a hit, then, it could lead to something much bigger.

More All Aboard Florida news
Take #1: Now, it's time for the construction to get started, and hopefully, I will be one of AAF's first passengers in two years' time.

Take #2: Tampa officials need to understand that Jacksonville is naturally on the FEC route and that it only makes sense for AAF to look northward not westward once the trains are up and running. However, that doesn't mean that Tampa shouldn't get a look from the fledgling passenger entity. Perhaps, there will be some commuter option that eventually stretches into St. Petersburg as part of a future deal to provide that area with intercity service. Of course, there is always the possibility that state of Florida gets off its high horse and provides California-style corridor service that may not require AAF at all.